Master validates party’s defective delivery of part 36 withdrawal because of new discount rate

A High Court master has allowed a party’s bid to withdraw a part 36 offer ahead of the new discount rate coming into force on Monday, even though they used a defective method to deliver it.

In Thompson v Reeve & Ors, the claimant – who suffered a road traffic crash and then negligent treatment of her injuries – valued her case at £347,000 and last August made a part 36 offer of £340,000.

On 28 February 2017, her solicitors emailed the defendants to withdraw it and Master Yoxall said it was “no secret” that this was because of the announcement of the new discount rate the day before, as a result of which the claim would be worth about £602,500.

On 2 March, the defendants tried to accept the part 36 offer, again because of the new discount rate.

CPR 6.20 only permits service by email where the receiving party has indicated in writing that it is willing to accept service by email, which was not the case here. The claimant submitted that rule 3.10 – which gives the court a general power to rectify matters where there has been an error of procedure – could be used to validate service.

Master Yoxall said the case law showed that rule 3.10 has a “wide effect” and could be applied in this case.

He said: “I accept that it has no application in certain circumstances, eg rule 7.6(3) which specifically describes the only circumstances in which the time for service of the claim form can be extended. Likewise I accept that rule 3.10 cannot be invoked to extend a statutory time limit or to avoid service of a document required by statute.

“In the present case, the claimant gave notice in writing of the withdrawal. It is not disputed that the notice was actually received. The notice provides the defendants with all the information necessary… It is the method of service which is defective. In my judgement, rule 3.10 can be invoked to cure the defect.”

While accepting that part 36 was a self-contained code, the master said it was “not completely freestanding”.

The final question was whether to exercise the discretion to make an order under rule 3.10. Saying it would be just to do so, Master Yoxall concluded: “In my view, it would not be consistent with the overriding objective that a technical breach of the rules should impede the proper assessment of damages in this case.”

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